Trading Made Simple

Lane you are doing a great job.
Please explain to us what make you to take a trade . Please step by step. I really appreciate.

The Market Base Line (yellow line) is still showing that we are not in a trend. That's probably why your SL was hit. In addition to this, I know this isn't part of TMS, but the PA is testing the 200 EMA. It might break the resistance or it might not. If it doesn't, why risk going into a bad trade because the TDI tells you to? You are taking a trade against the last trend.

I'm not telling you how to trade but if I were you I would determine if price goes into a trend, either up or down, and then decide on what position to take.

Just out of curiousity, what was your SL? If your money management is decent and you are risking no more than 2 or 3% of your account per trade, your stop loss could have easily been 70 pips on this pair.

To be honest I wouldn't be able to tell you the difference between BB 50/2 or 100/2, unless I put them both on charts and compare them visually. All I know about it it's some kind of volatility indicator. I have yet to get towards the nitty-gritty.

However, just from looking at it in my charts visually, it aids me a lot. General volatility aside, it gives me a general idea how much particular moves can actually move. I watch the middle line a lot since the price likes it (or it's it that likes the price?). Naturally this identifies strong S/R's.
Most moves cover the distance between the outer and the middle line (half the channel). Even when the start of the move is midway between those lines, it seems to "carry" the distance between those lines nonetheless.
Bigger moves cover roughly the whole channel. When the price strongly exits the bands (not talking just about news spikes) very soon it wants to get back in. So it gives a lot of ideas for TP areas, and the overall PA relative to the bands combined with the TDI, GMMA's, give you a lot of heads-up for new trades.
Of course the bands are not necessary if you know the general PA of the pair. But it's an indicator. It indicates. Both volatility and S/R. For me it's very important to visualize potential moves, anticipate entries and exits.

I've yet to learn about this indicator (and just about any other we use ), but so far I use it specifically to give me an exit point for a short move (retrace). You can see it on above trades. PA is trending along the outer band, TDI green (the sentiment) on higher TF it gets tired, traders taking profits, I switch to the lower TF (H1/H4) to put a neat early stop order and TP a little below the middle Bollinger line (just to make sure; or above the line, if sell) and there you go. Of course I check with previous S/R to see if it all makes sense, but seems like it always does, I guess that's how those lines get calculated.

I notice also that the outer bands can act as exit points. Usually when the bands go nearly or totally flat - I'm guessing that's when you enter a "rangish" market.

Hope you have some use of my beginner observations.

Lane,

I think what you just said is great!
Everyone should read your post...

As you get more experience, in learning the
system and trading in general. You will find
overtime that you get better & better.
Onward & upward...

sj

To be totally honest with you, I will never ever again trade without Bollinger Bands. That's how strongly I feel about them. The reason being, as the bands are expanding, this indicates that price action is in a trending mode, and when bands are beginning to narrow, reverse, or "squeezing", the price mode is generally a consolidation zone. Trading in a consolidation zone is quite risky, it's better to wait for the bands to indicate a trend resumption or breakout and then trade the trend.

Shadodwel,

Nice meeting you!

I had to laugh, that is exactly what I think!

Way to go...

sj

Thanks mate

Finally it all started sinking in after a month of reading overwhelming material

Thanks. But keep in mind I've just been testing some of my personal rules for a few days. Already I have quite a few ideas to tweak my rules, but I need to let it flow for a while. If after at least few weeks I keep profiting consistenly, only then can I call this my "trading plan".

I can't tell you the exact rules, because we simply do not think alike, and no matter how similar we may think there's at least one aspect we have different opinions on. Which means we'd all make different little decisions because of our psychological differences.
Take any sport... Players have different roles. Some can have multiple roles, but are more suited for one specific role. In football, an attacker normally is bad at defending, and vice versa. Even those two attackers you see in the final third of the pitch have different roles. For example, Robben can be a striker. But he is usually used as a winger because of his special dribbling and crossing skills. Van Persie is totally different, eventhough both score great goals. (I mention those because your profile says Netherlands).

Anyway, I've mentioned a few of my rules in the past few posts. Read them if you want. It's basically pure TMS, modified by Snarlyjack (GMMA's, Bollinger Bands, TDI_RT). I don't use stochastic. By the rules I use the TDI as my only main indicator, however I look at the whole TDI, not just the crosses or bounces. Angles, slopes, previous movement, their position one relative to the others (green, red, yellow - I haven't yet found a real use of blue Bollinger bands that the PA "Bollingers" don't have). TDI is the first thing I look when I scroll through the charts. Like mentioned I always look at higher TF's to have a general idea of PA. The BB and GMMA help me in this. One TF higher is THE BOSS. It tells me if I can expect a move. Even if it's a retrace, I'm interested - however be careful with those, I am playing with fire since I'm inexperienced. However the "boss" gives me confidence and so far I'm successful.

However when I first started learning about TMS, reading this thread from the beginning, watching Dean Malone's videos and demo trading, over the time I got frustrated to see the system WORK, but me missing on so many trades, or getting late for slim pickings. So as all this info I had been reading and watching started sinking in, and I'm able to analyze the charts OK (remember good old Socrates - "All I know is that I know nothing" and keep learning). Now what I do is try to anticipate those TMS entries with buy/sell stop orders. Common sense and back testing the PA and TDI movement gives you knowledge to keep you out of bad trades. The blue GMMA's give me a minimum criteria to place the stops. Other criterias are previous candles, lows, highs, S/R, common sense. For these entries to be probably successfull, it's essential to pick clear trades from the upper TF, otherwise those fakeout wicks will trigger your order and run back.

So far, it works pretty well (knock on wood). We'll see more. WHEN I start making losing trades, I'm interested to see if it's because I didn't respect my rules, or didn't analyze the charts well enough, or just because of a too big a fakeout and no TP.

Another important thing is setting TP's, I've talked about those not long ago. During retracements I pretty much expect the first candle to trigger my TP. Maybe that'll change in future and I'll aim for TP2 in some situations, who knows...
One important principle is play it as safe as possible. Which means I take the TP number one, if 20 pips profit looks safe and I feel confident compared to the 40 pip line, I take the first.
Another principle is correlation as you can see above. If it's not a scalper move, the E/J will bring along the C/J usually. For example. Sometimes if one pair has a clear trade signal and the other one is a bit iffy, I put orders on both but i tighten the TP on the iffy one.
Safer TP's, conservative profit for one pair possibly doubled with the other. But make a mistake and you double your losses.

There you go, one long post for the general idea. Questions, comments and criticism very welcome.

Friends,

I am very happy to see emmanuel's post. Some pages ago he mentioned the use of TRO 34 EMA PAC as trend filtering. It seems to me, that in his posted chart in the pdf it is the thick yellow line. After his post I applied the above indicator to my chart as filter and I would like to share you my trade of EURAUD H4 using this filter.

This was a long trade. Reasoning:

1. Price is above trading TF trend line (and PAC)
2. Price is above the higher TF trend line (silver/black bold line;EMA(204), because 6*4=24 -> daily TF, so the EMA(34) on the daily is EMA(204) as 34*6=204)
3. Bullish TDI cross occurred after bullish TDI cross above MBL
4. HA candle was also bullish.
5. I entered right after the close of the second bullish HA candle, when the TDI cross occurred
6. My TP1 was the 60% of the average daily range of the previous 5 days, TP2 was between the previous week's range Fib 127% and 138%.

I am looking forward to reading some more details of emmanuel's TMS-II.

take care,
thrax

Hello,

I'am glad to hear that people are making money using this guppy/tdi system.

Ok...so here are my daily charts, on the charts I watch.
I look at my daily charts and go, hmmm...what do I think?
This is where things get interesting. Look at the tdi and the guppy's very carefully.

sj

Here is the rest of the charts.

Looks like we are in the middle of Bollinger Band - Stong resistance or support. Next candle close will show chart direction. USD/JPY is in big squeeze it may start trending.
I like your green charts.

RabbitWolf,

Nice meeting you & welcome to tms!
I like that you like Bollinger Bands,
they are very useful.

Anyway, here are the 4 hour charts.
It looks to me that the tdi is starting
to hook up. The move is flattening out?
Time will tell.

Welcome to tms.

sj

Jack
What are the3Amigo's?
thank you
Barry

1 Nov 2013:

Euro 'falling knife'



How do you catch a falling knife?

One way is to look for a 'dead cat bounce'.... a TMS-II technique. Posted before, and if you had read my posts , you will know that one.

Hi Emmanuel,

I'am thinking a "dead cat bounce".
This is where it get's interesting, any thoughts?

bvincent,

The 3 "Amigo's" are:
eur/usd
gbp/usd
aud/usd
They are called that cause they tend to move together.

sj

Places where grizzy love to feed ....

Attachment




Dead Cat Bounce link to one example in this thread.

Also, the other is the 'Arjun candles' ... I just love them when I am in M15 for entries. Smalll SL 10~20pips.

and the 4th Amigo is EURGBP, during those intradays when EU and GU don't agree with each other, this 4th Amigo is money spinner and its pip $value is much higher.

Have Fun!

Dead Cat Bounce...

ahhaha.. this is very cute and nice.. me likey

the fun part would be.. where to catch the bounce